SEMA-members companies have posted several new listings for job opportunities at www.sema.org/classifieds. Working for a SEMA-member company has many advantages. In addition to working for a company that supports and contributes to the success of the overall industry, being employed by a SEMA-member company enable the employee to participate in webinars, access free market research, join SEMA committees and more. The newest classified listings posted under Positions Available include:

• Marketing Associate/Customer Service Support, Norwalk, California
• Truck Suspension Sales Tech, Costa Mesa, California    
• Regional Sales Manager - New Business Development, Sarasota, Florida    
• Sale/Inside, Huntington Beach, California
• Tech Editor and Media Contact, El Paso, Texas
• Sales, Las Vegas, Texas
  

The links below represent SEMA’s councils and committees, groups dedicated to specific market niches and professional groups within the specialty-equipment industry. For more each council and committee, click the link below, or e-mail member@sema.org to request more information.

SEMA Council and Committees

Restoration: Automotive Restoration Market Organization (ARMO)
Hot Rod: Hot Rod Industry Alliance (HRIA)
Light-Truck Accessories: Light-Truck Accessory Alliance (TORA)
Manufacturers’ Reps: Manufacturers’ Rep Council (MRC)
Motorsports: Motorsports Parts Manufacturers Council (MPMC)
Restyling: Professional Restylers Organization (PRO)
Sport Compact: Sport Compact Council (SCC)
Wheels and Tires: Wheel and Tire Council (WTC)
Businesswomen: SEMA Businesswomen’s Network (SBN)
Young Executives: SEMA Young Executives Network (YEN) 

According to information from The NPD Group, a consumer and retail information company, marketers of vehicle appearance products (i.e. car care) could see a boost in business this spring. The firm reports 12% of consumers surveyed last fall indicated they would spend more money on vehicle appearance this year; only 4% said they would spend less.

Early spring data indicates that consumers may be following through on their promises. Based upon NPD’s Early Indicator Report on sales through the auto-parts channel, dollar sales for appearance products and accessories were more than 17% higher in the month of March 2007 versus the same month in 2006.

“Traditionally, the spring season brings consumers outside and into the driveway for some much needed car care” said David Portalatin, director of industry analysis for the NPD Group. He adds, “The growth we’ve seen so far is especially encouraging, given that winter has lingered in many parts of the country a bit later than usual.”

Portalatin sees an opportunity for a broader impact beyond just appearance. He stated, “Marketers of aftermarket products and services should consider how they can leverage this opportunity to drive sales in many categories. They should look for ways to take advantage of any lift in consumer traffic that may be generated by automotive spring cleaning. For example, think about bundling and cross-promoting maintenance and/or repair-related categories to help consumers take care of their cars inside and out.”

NPD’s Car Care Trac adds insight into the appearance-product consumer to help automotive products manufacturers and retailers make the most of this marketplace opportunity. The data shows that although vehicle appearance is a concern for drivers across the demographic spectrum, consumers ages 18–24 are a bit more likely to purchase appearance products. This segment is quite image-conscious, and this attitude extends to their vehicles, especially this time of year. In addition, higher-income consumers are also more likely to buy appearance products. These consumer segments may hold the key to unlocking big sales this spring.

Having the right brands will also be an important factor, according to the NPD Group. When asked how they would respond if their preferred appearance-product brand was not available, one out of four consumers said they would not make the purchase at that time. One in five would go to a different store to find their preferred brand. Consumers also cited ease of use as playing a role in their brand choice. In fact, the average do-it-yourself consumer is 37% more likely to say “ease of use” was a reason for choosing a particular brand.

Although favorite brands and ease of use are driving forces in vehicle-appearance purchases, nearly half of the do-it-yourself appearance-product consumers make their purchases impulsively. These consumers are 47% more likely to decide to buy products once they have gone into the store, heightening the importance of in-store placement, promotion and appealing packaging.

Source: The NPD Group, Inc. (May 2, 2007). “NPD Reports Consumers Will Spend More On Vehicle Appearance This Year.” The NPD Group, Inc. press release.

Without a doubt, safety and security features and services are becoming an increasingly important part of automakers' arsenal as they try to differentiate themselves from the competition and woo more customers into their fold, according to a recent TechnoMetrica Market Intelligence article. In a recent newsletter, TechnoMetrica states that the trend of adding more features and services to today’s vehicles is not confined to safety and security. Information and entertainment are also key areas that are growing each day with things like DVD players, Bluetooth technology, satellite radio, navigation systems, ports and gaming consoles becoming more and more common.

TechnoMetrica’s research shows that consumers really want all these add-ons. However, they qualify that by adding that, not everything making its way into today’s vehicles are equally desirable. Consumers place heavier importance on features and services that have a concrete, directly practical use. Because of this penchant for practicality, navigational aides and safety or security services score highly among most Americans.

Items at the bottom of the list include things that have little directly applicable practical value for drivers—gaming consoles come to mind here.

But that’s not to say a market for in-vehicle gaming consoles doesn’t exist. It does. Especially among those who chauffer their children around a lot on long trips where anything that keeps the kids occupied is a blessing for weary drivers. Below are TechnoMetrica’s estimated penetration rates for selected in-vehicle features and devices:

• DVD Player–23%
• Satellite Radio–12%
• Navigation Systems/Features–10%
• Safety/Security Services–10%
• Ports for Multimedia Devices–10%
• High Definition Radio–7%
• Bluetooth Technology–5%
• Gaming Console–4%

Source: TechnoMetrica Market Intelligence. “Developing Trends.” AutoView newsletter.

The future of filters appears to be heading in a good direction, according to a new study from The Freedonia Group, Inc. A recent Aftermarket Business article states that filter shipments are projected to advance 3.2% annually through 2011 to $10.9 billion. Gains will be driven by ongoing sales in the aftermarket, which accounts for the vast majority of demand. Advances will also be spurred by pending changes in environmental regulations, particularly those involving cleaner air and a reduction in diesel engine emissions. Manufacturers’ increasing interest in reclaiming production inputs from process water and investing in water-recycling processes to reduce costs will also drive demand for filters.

Additionally, advances will be aided by an increasing penetration of newer products, particularly motor-vehicle cabin air filters, many varieties of home air and water filters and the development of a significant aftermarket within these segments. These and other trends are presented in “Filters” a new study from The Freedonia Group, a Cleveland-based industry research firm.

Shipments of air filters are expected to post the strongest growth through 2011, driven primarily by changes in environmental regulations and gains in the consumer market. The internal-combustion engine and related filter segment (oil, air intake, fuel and cabin air) is a relatively mature product group that is expected to post more modest gains but will benefit from the ongoing development of new types of diesel-engine filters and a growing aftermarket for cabin air filters.

The motor-vehicle market will continue to account for the largest portion of total demand, with a 24% share in 2011, despite below average growth, the company reports. The high volume of these oil, fuel and air-intake filters sold as original equipment and in the aftermarket more than offsets their relatively low unit prices.

Demand for filters in the other transportation equipment and utilities markets is projected to post the strongest gains, powered by current and pending regulations and concerns about the quality of air and portable water supplies. Demand for filters used in diesel-powered off-road equipment will also post strong gains, primarily stemming from pending regulatory changes.

“Filters” is available from The Freedonia Group, Inc. For more information, contact Corinne Gangloff at 440/684-9600, pr@freedoniagroup.com or visit www.freedoniagroup.com.

Source: “Sales Not being Filtered Out in Product’s Future.” Aftermarket Business. Retrieved May 18 from www.aftermarketbusiness.com.

The benefits of strategic planning are many, but the planning process itself has its own rewards, according to a recent article by Dan Beaulieu, president of D.B. Management Group LLC. The excerpt of his article below describes how companies can benefit by taking the time to develop a strategic marketing plan:

Does your company have a strategic business plan? How about a formal marketing plan? Does your team sit down together at least once a year and hack out how you did this year and what you plan to do next year?

How often do you really sit down with your team and talk about the future? Chances are you spend most of your time together talking about running your daily operations. But how often do you put these issues on hold and talk about your business, your future and your vision?

This is the one key factor that differentiates the good companies from the great companies. If you don’t take the time to reflect on where you’ve been and plan on where you are going, then you are not doing your job, says Mr. Beaulieu. Your team will never be solidly united and your company will never be great.

Planning does not have to be tedious; it can be a lot of fun. During the planning process, your team members will discuss their visions for your company. Try to get your staff to open up to focus on what is going on outside of your company; that is what really matters. Try to get them to focus on what current and potential customers want. Make the sessions as open and productive as possible. Make sure that you allow a decent amount of time for this exercise and that you are completely isolated, ideally at an off-site location.

All of your first reports should participate in these sessions, even HR and accounting. They have ideas, and they need to be part of the future as well. The sales manager should bring input from the sales team. As the number-one customer advocate, the sales manager needs to bring the customer to the table.

To make sure that the discussion goes in the right direction, Mr. Beaulieu likes to use a series of questions about the company. What kind of business are you in? Why should people do business with you? Also ask about your products—today and in the future—and about your competition. These questions, when answered intelligently (a short-answer essay test, not a true and false test),  will generate the basis for your strategic sales and marketing plan.

Here are some of the benefits you will derive from this exercise, besides having a good plan for the future:

• You will unite your team.
• You will have a common vision. By developing this plan together, everyone will feel ownership of the plan and the direction the company is taking. Do all of your disagreeing in private, and once your team emerges from the planning sessions, it will be one team, one plan, one vision.
• You will have woven the flag for the entire company to follow. People follow messages and ideas rather than money and other incentives.
• You will have a well defined company. You will know with clear insight where you’ve been and, most importantly, where you are going.
• You will know your message and be able to communicate to the rest of the team, your sales reps, your customers and your marketplace.
• You will have a great way to measure your progress. Part of developing a good plan is setting goals and then measuring performance against those goals. You will have put in place a successful process that you can use over and over again, year after year. Mr. Beaulieu is a proponent of the idea of having quarterly updates to check on how things are going against the plan you developed.

Make sure that you stick to your plan, but keep it flexible. Try to develop a plan every year. The first year will be the toughest, but the second and third years will be the most dangerous with the temptation to get lured into the “ditto” mindset. This will happen when you start hearing yourself or your teammates say things like, “We covered that pretty well last year; there is really no reason to cover that again this year.”

Treat every year as a new year. Build on the previous year’s plan, but please do not dilute the quality of your brainstorming session this year because “we already did this last year.” Give this a try this year.

Mr. Beaulieu is a marketing expert who helps companies boost sales with targeted strategies, tactics and communication plans. After working as a top sales executive for three major fabrication companies, he now heads up D.B. Management Group. For more, visit www.dbmpcb.com.  

Source: Beaulieu, Dan. “Benefit from Sales and Marketing Plan!” www.dbmpcb.com.

Automakers aren’t the only companies taking a keen interest in plug-in hybrid-electric vehicles (PHEVs). Electric utilities are realizing development of such technology could bolster their bottom line, as well, according to a recent WardsAuto.com article.

Although PHEVs offer promising fuel efficiency, they face a number of hurdles before being introduced to the marketplace. Arguably, the most significant challenge is the way the nation’s energy grids will handle the additional power needed to recharge large numbers of plug-in vehicles.

GridPoint Inc., a Washington-based energy-management company, says it has the solution and is working with both utility companies and automakers to make PHEVs viable. Established in 2003, GridPoint’s first order of business was the creation of a standalone power unit called GridPoint Central to be used by utility customers to monitor their energy use. Similar in size to a standard refrigerator, customers can track their energy consumption through the GridPoint unit or via a dedicated website.

“You can log on to our site and see your usage for the month,” Brian Golden, GridPoint’s vice president-product strategy, told Ward’s Auto. “You can see the number of kilowatt hours used and their dollar value.” For example, he says, “You could see that you spent $140 running your air conditioner last month and change your operating characteristics to save money.”

A system that allows fine-tuning of household energy use would appear a perfect fit for PHEVs, which require massive amounts of electricity to recharge their batteries. Golden says a PHEV owner could program GridPoint Central to recharge his vehicle during off-peak hours when electricity is cheap. Or, if necessary, the owner could override the program, allowing for charging during peak hours, albeit at a greater cost.

The way it would work, Golden explains, is the GridPoint Central unit would be owned by the electrical utilities and rented to customers for about $20 per month, with an additional $10 monthly fee for the online monitoring service. Customers would be required to sign a contract with the utility company that allows for greater control over the individual’s energy use by optimizing the flow of power for more uniform electricity output. The peaks and valleys of everyday energy consumption would be leveled out, and energy that normally goes to waste during off hours would be used to charge PHEVs. As part of the deal, the utility would pay customers about $5 a month to access power stored in a stationary PHEV’s batteries when needed during peak hours, minimizing the chance of a grid overload, Golden says.

Because PHEVs run on both gasoline and electric power, in the unlikely case a vehicle’s batteries were drained completely by the utility, the owner still could drive the car with minimal inconvenience. Golden says, theoretically, a PHEV owner could operate his vehicle on electric power without ever paying a dime by programming the GridPoint Central system to sell power borrowed from the vehicle’s batteries for more than the customer’s original cost. For example, if a vehicle was to recharge itself at night at a cost of $0.08 per kW/hour, its owner could sell back the power to the electric utility at $0.50 per kW/hour.

“You could get all your fuel paid for the lifetime of the car,” Golden says. “That’s why you need an intelligent platform to manage this.”

With the technology in place to interact with electric utilities, Golden says his company now is working with several automakers to overcome some major roadblocks before PHEVs can be recharged through the GridPoint system. These include how to instruct the vehicle to discharge its energy and the way in which it would do so. “We’re working with automakers on the discharging. It’s not something (PHEVs) were originally designed for,” Golden says. “Also, how do you get power back to the electrical grid? Maybe through the same plug, but we’re not sure yet.” Golden predicts PHEVs will be on the road in about three years, and GridPoint should be able to interact with them seamlessly in about five years.

But while Golden’s company is confident all the bases are covered, some auto-industry insiders are not so sure. Susan Cischke, senior vice president of sustainability, environment and safety engineering at Ford Motor Co., says she is not convinced the nation’s electric grid will be able to handle the additional loads created by a proliferation of PHEVs. “Having lived (in southeast Michigan) a couple of summers ago when the (regional) grid went down, I don’t know if it’s ready,” she tells Ward’s Auto. “I do agree there’s a real opportunity to take advantage of off-peak power, but I think that more study would need to be done.”

Another concern of Cischke’s and others is the advancement of hybrid-battery technology.

Today’s hybrid-electric vehicles use nickel-metal-hydride batteries, which are durable but don’t hold enough energy to be viable for use in PHEVs. Many automakers say the solution is lithium-ion batteries, but they cost much more and are not as durable. As such, capable energy-storage devices are needed before PHEVs can be readied for production, Cischke says. The cost to accelerate the development of lithium-ion batteries currently rests largely with the auto industry and a handful of battery producers. A new business model likely will have to be implemented to speed along development, perhaps through government subsidies, Cischke says. Another alternative is to have the power companies own the batteries, she says.

“At one time, the phone company used to own all the phones, so maybe there’s a different model out there,” she says. “The model we know today may be different (in the future), it may be one in between.”

While acknowledging the obstacles, Cischke admits GridPoint’s business model is intriguing. Considering that much of the criticism surrounding the use of E85, a blend of 15% gasoline and 85% ethanol, is the lack of a public refueling infrastructure, GridPoint’s PHEV plan has the necessary electrical grid already in place. “I definitely want to talk to (GridPoint),” Cischke says. “I think we have to expand our view of alliances and partnerships to accommodate a full range of transportation options.”

Source: Pope, Byron. (May 14, 2007) “GridPoint Readies PHEV Battery-Charging System.” WardsAuto.com. Retrieved May 17, 2007 from www.wardsauto.com.

Despite the sale of Chrysler group by DaimlerChrysler, powertrain analysts at CSM Worldwide expect the restructured Chrysler to remain highly competitive in the powertrain arena well into the next decade. According to a recent CSM Worldwide press release, Chrysler has been aggressively procuring designs and outsourcing powertrain production from its global partners. The link that will be maintained with Daimler AG will be a key element of this strategy.

“Decisions regarding the long-term supply of Chrysler engines and transmissions have already been made,” said Eric Fedewa, vice president of global powertrain forecasts at CSM. “Moving forward, Chrysler will increasingly outsource its powertrain programs, both design and assembly, to outside suppliers and strategic partners.”

As an example: of the engines Chrysler assembles, 42% are purchased designs while almost 35% of its transmissions are purchased designs. By 2013, according to CSM’s forecast, the company will increase design purchasing to 77% for engines and 68% for transmissions. This practice allows access to innovative technologies from suppliers, which is vital for product differentiation and maintaining a competitive edge.

Products from Chrysler’s powertrain strategy include the new line of four-cylinder engines developed in a joint venture with Hyundai and Mitsubishi, the high-tech Phoenix V6 coming in 2010 as a replacement to the current lineup of V6s, and the Two-Mode hybrid transmission co-developed with General Motors and BMW.

A recent AutoWeek article delves further into what to expect from Chrysler as far as product lineup. By the time Cerberus Capital Management’s $7.45 billion purchase of Chrysler finalizes in the third quarter of this year, the 2008 Dodge Challenger will be less than a year from introduction. The article also reports that “well-received Chrysler concepts from the past two years should be in line for the production green light.” 

Chrysler expects to continue to invest in future products as planned, and the new owners of the car company intend to follow Chrysler CEO Tom LaSorda’s lead while investing even more into future products. The company’s future vehicle-production plan includes 20 new vehicles and 13 major facelifts for its current lineup by the end of 2009, despite reducing the company’s platforms from 12 to seven. More specifically, Chrysler plans to bring out its fifth-generation Chrysler minivan later this year, the Chrysler Sebring-/Dodge Avenger-based crossovers and the next-generation Ram pickup.

Cut from the portfolio will be the Dodge Durango and Chrysler Aspen once the plant that produces the slow-selling big SUVs is shut down in late 2009. The company has partnered up with China’s Chery Automobiles to bring out a production version of the Dodge Hornet mini-car (middle picture below). Chery will likely join forces with Chrysler to bring out the production version of the Dodge Demon roadster as well (bottom picture below). Chrysler is also considering production of its well-received Chrysler Imperial concept (top picture below), which the company says could spark further interest in the Chrysler brand.
 


Sources: CSM Worldwide. (May 15, 2007). “CSM Powertrain Analysis: Chrysle’s Powertrain Lineup Will Remain Strong Through Partnerships.” CSM Worldwide press release courtesy of PR Newswire; Gritzinger, Bob. (May 15, 2007). Imperial Dreams: Chrysler Sale Could Bode Well for Future Product. AutoWeek. Retrieved May 18, 2007 from www.autoweek.com.

SEMA members cited rising operating costs as the number-one obstacle facing their businesses, according to a SEMA research. Part of these operating costs include money spent on energy, and a recent study showed that businesses in general are faced with similar challenges imposed by rising energy costs. Results from a survey of North American business leaders indicate they expect energy prices to continue to rise, and plan to invest in energy efficiency measures to help fight rising costs, according to a recent Johnson Controls press release.

The Johnson Controls Energy Efficiency Indicator research commissioned by the company identified individuals from a wide range of facilities and locations who were decision-makers for energy-management issues within organizations. They asked how these managers were responding to rising energy costs, defined as electricity and natural-gas costs. Members from the International Facility Management Association were included as survey respondents. 

Just over half (52%) of the executives surveyed say that costs savings are either entirely or somewhat the driver for their decision to invest in energy-efficiency measures. Thirty-five percent say cost savings and environmental responsibility are equal motivators, while only 13% cite environmental concern as the greater motivator.

The executives appear to have reached a consensus that energy costs will continue to rise in the near future. Seventy-nine percent say they believe that electricity and natural-gas prices will increase significantly during the next 12 months, with an average price hike of 13.25% expected.

Consistent with the rising energy cost forecast, 62% say their companies are paying more attention to energy efficiency today than five years ago. As a result, they are acting on it. Almost 57% expect to make energy-efficiency improvements using their capital budgets in the next 12 months, spending an average of 8% of those budgets. In addition, 64% anticipate using their operating budgets, allocating 6% to energy-efficiency improvements.

Despite the pain of rising energy costs, executives are generally limiting their investments to more conservative energy-management solutions. Of respondents who have already made energy-efficiency investments:

• 70% educated staff and other facility users on how to be more efficient
• 67% switched to energy efficient lighting
• 60% adjusted HVAC controls
• 46% installed lighting sensors

Commercial buildings consume about 40% of natural gas and 60% of the electricity generated in the United States. So it’s not surprising that three-quarters of executives with companies that are building or planning to build new facilities, or are launching retrofits in the next year, say that energy efficiency will be a priority in the design of those projects.

When it comes to energy-supply-related matters, 36% have negotiated energy contracts with suppliers. Only 14% are putting energy-price hedging strategies in place. In addition, 11% currently have a stated carbon-reduction goal.

“This survey provides a valuable snapshot of how organizations are reacting to rising energy prices, and I think we’re going to see even more attention paid to this in the future,” said C. David Myers, president of the Johnson Controls Building Efficiency business. “There’s a growing realization of the role commercial and industrial facilities play in energy consumption, and the role they can play in making the economy more energy efficient.”

Whatever the motivation for making energy-efficiency investments, companies have by and large not relaxed their payback requirements for such measures (i.e. time for return on investment). About two thirds of companies (64%) have a maximum payback period of between two and five years. Overall, only 18% of those surveyed say their companies would allow a longer payback period today than five years ago. About 45% say the required payback period has not changed compared with five years ago.

Executives responsible for larger facilities (500,000 square feet or more) are an exception, according to Johnson Controls. They spend a bigger part of their budgets on energy, are planning to invest more of their budgets on energy-efficiency measures and will tolerate a longer payback period. A summary of the survey findings are presented below.



Source: Johnson Controls (May 17, 2007). “New Research Shows Businesses Investing in Energy Efficiency Measures to Combat Rising Energy Costs.” Johnson Controls press release courtesy of PR Newswire.

Rising gasoline prices have some owners of large and midsize trucks trading to smaller vehicles, according to J.D. Power and Associates, which uses real-time retail transaction data from its Power Information Network (PIN) to gather figures. In a recent press release, it said gasoline prices have surged more than $.20 in recent weeks to a record nationwide average of $3.10 per gallon, surpassing the previous record of $3.07 per gallon set in September 2005, according to the U.S. Energy Information Administration (EIA). As gas prices rise, owner loyalty in the large pickup and midsize and large utility-vehicle segments drops, according to PIN data gathered between February and April 2007. Owner loyalty is measured by the percentage of owners in any given segment who trade for another vehicle in the same segment.

“We’re seeing a broad, long-term—but gradual—movement to smaller vehicles,” says Tom Libby, senior director of industry analysis at PIN. “For example, during periods of high gas prices over the past two years, we’ve seen movement from larger to smaller SUVs. However, the total SUV pie remains largely intact.”
 


Not every new-vehicle segment has been affected by rising gas prices. For example, PIN findings show that owner loyalty for large and midsize cars, small crossovers and small SUVs has remained relatively unchanged in recent months. Libby notes that all of these trends are consistent with the patterns observed in spring 2006 when gas prices also rose.

Increased demand for smaller vehicles, coupled with higher gas prices, has also given four-cylinder engines a boost in powertrain market share. Four-cylinder engines, as a percentage of total retail sales, has increased from 27.5% in April 2004 to 35.7% in April 2007. While vehicles powered by four-cylinder engines are receiving a lift from rising gas prices, so are new vehicles powered by hybrid-electric engines. Hybrid vehicle sales have shown a strong correlation to gas prices. For more than two years, hybrid sales have increased as gas prices have risen and have decreased as gas prices have fallen. 

 


Additionally, PIN data shows that the retail turn rates—the amount of time a new vehicle spends on a dealership lot before being sold—decreased for both new and used small cars as the price of gas increased. In particular, these retail turn rates suggest that certain parts of the used-vehicle market, such as small cars, compact basic cars and small luxury crossovers, benefit when fuel prices rise. PIN and J.D. Power and Associates data suggest that the small-car market—both new and used—will continue to strengthen as fuel prices escalate.

“The recent strength of the small-vehicle segments—pricing, styling and an increasing number of new models—is receiving an additional boost from high gas prices,” said Bob Schnorbus, chief economist at J.D. Power and Associates. “We’re expecting the small-vehicle segments to continue to grow, regardless of gas prices, but higher gas prices certainly will help these segments relative to others.”

Source: J.D. Power and Associates. (May 16, 2007). “Power Information Network Reports: Rising Gas Prices Begin to Sway New-Vehicle Owners Toward Smaller Versions of Trucks and Utility Vehicles.” J.D. Power and Associates press release courtesy of PR Newswire.